Dollar eases, yen finds floor from Tokyo's jawboning

investing.com:

By Rae Wee

SINGAPORE (Reuters) -The dollar was on the back foot on Tuesday, owing to profit taking and pressured in part by a slightly stronger yen as Japanese government officials continued their jawboning to defend the currency.

Against the greenback, the New Zealand dollar rebounded from a four-month low and last rose 0.13% to $0.6011, and likewise for sterling which firmed 0.1% to $1.2649, away from last week's one-month trough of $1.25755.

With a relatively light economic data calendar for the week, the market focus turns to the release of the Federal Reserve's favoured inflation measure on Friday, which could guide the path of the U.S. interest rate outlook.

The U.S. core personal consumption expenditures (PCE) price index is seen rising 0.3% in February, which would keep the annual pace at 2.8%.

«The Fed Chair has tried to push the market away from aggressive interest rate expectations at the start of this year and he's always been maintaining the idea that it was going to be a bumpy path,» said Tony Sycamore, a market analyst at IG.

«But a print of 3% (annually) or greater would certainly create a lot of concern that maybe the bumpy path is going to be bumpier than expected.»

A shift in the global rate outlook following a slew of central bank meetings last week had pushed the dollar to a one-month high against its major peers.

While the Fed stuck to its projection of three rate cuts this year, other major central banks similarly signalled that an easing cycle was in play.

«It's tough for the (dollar) to sustain any weakness with a backdrop in which U.S. growth outstrips growth in the rest of the world,» said Thierry Wizman, global FX and rates strategist at Macquarie. «But it's even tougher for the (dollar) to